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Bowl Leader
It depends how your mortgage company applies the payment. It might not help you at all.
In theory if you pay down a debt early less interest accrues, so paying half early and half in time would slightly reduce the interest portion of your payments and pay down the loan faster. In practice I think most just aggregate all payments and treat as paid on the due date.
SM1: spot on. I tried with my lender and they treat it as one payment. Need to find one who applies to the loan account when paid.
Rising Star
You don't do 1st and the 15th, you do "every other week".
The goal is to make 26 half payments which translate to 13 regular payments. If you do 1st and 15th you'll make 24 half payments or 12 regular payments
The strategy mentioned by OP helps pay 30-40% less interest over the time. And you are paying the same amount each month (instead of one payment, split into two halves). Awesome, isn’t it. But challenge here is most mortgage companies don’t apply them to your account when paid but only once similar to if you paid once a month. This resulting into no benefit to the customer. They keep it in a separate account and apply it once a month when due.
Rising Star
This is not going to help. The common suggestion is to make bi-weekly payments instead of monthly payments, which results in one extra payment per year than you normally would have made paying monthly.
Bowl Leader
The two week approach is assuming you are paid every two weeks to line up with when you have cash in your checking account. If paid twice a month just add a little bit extra as a principal payment for the same effect.
I believe you also save an incremental amount on interest by getting two weeks ahead of schedule. However, my bank (BofA) only allows this approach if you pay to use their program, which negates any real savings IMO.
Rising Star
They apply the payment to principal (and interest) when received so you would pay less in interest. You can achieve a similar result by making 1 extra payment per year.
Rising Star
Agree, it would most likely have to be part of the setup or agreement with the mortgage co